Stock futures edge up; earnings in focus

WilliamL. Watts

NEW YORK (MarketWatch) — U.S. stock futures rose Friday, indicating Wall Street would attempt to build on gains that took the S&P 500 index to a record in the previous session, as investors turned their focus to earnings from Morgan Stanley, General Electric Co. and Google Inc.

The S&P 500
US:SPX
on Thursday finished at a record level, as Wall Street turned from the resolved fiscal showdown on Capitol Hill to corporate earnings that included better-than-expected results from Verizon Communications Inc.
US:VZ

“The sentiment in the market today is one of mild relief and back to business as usual. In spite of very few actually believing the U.S. would default on its debt, most money managers had at least worked hard to prepare for the event. Now, the market is getting back to pricing in future value and observing performance,” said David White, trader at Spreadex, in a note on Friday.

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Earnings are also in the spotlight. Dow component General Electric
US:GE
on Friday posted net earnings of 31 cents a share in the third quarter, while profit slipped 9% to $3.2 billion. Excluding restructuring and other charges, earnings were 40 cents a share. GE was projected to report third-quarter earnings of 35 cents a share, according analysts polled by FactSet. GE shares rose 2.7% ahead of the open.

Morgan Stanley
US:MS
also delivered its latest quarterly results on Friday. The last of the six mega-banks to report, Morgan Stanley said it swung to a third-quarter profit, solidly beating analyst estimates. Net income came in at $906 million, compared with a year-earlier loss of $1.02 billion, helping send shares up 2.5% premarket.

The now-ended government shutdown delayed several economic reports that will now gradually be released in coming weeks. On Tuesday, the September nonfarm-payrolls report will come out, while consumer-price numbers for the same month will be released on Oct. 30.

But there are a number of Federal Reserve speakers on the schedule. Richmond Fed President Jeffrey Lacker — who isn't a voting member of the central bank’s policy-making committee — said more work is needed before markets and regulators have confidence in resolution plans, or so-called living wills, for the largest U.S. banks.

Fed Governor Daniel Tarullo, who is a voting member, gives a keynote speech in Washington at 1 p.m. Voting member and Chicago Fed President Charles Evans will speak at 2 p.m., followed by another voter, New York Fed President William Dudley, at 3:40 p.m.

Rounding off the lineup of Fed speakers, Jeremy Stein is set to talk about “methods for addressing financial imbalances” at 4.30 p.m.

In other financial markets on Friday, the dollar was mixed, while gold futures lost ground and oil traded higher.

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